TNAG-0631-FCO40-779-Effect-of-GATT-Multi-Fibre-Arrangement-on-Hong-Kong-negotiat-1977 — Page 153

CONFIDENTIAL

TRAN STRESSED THAT THE COMMISSION NEEDED TO BE CONFIDENT THAT

COULD ASSURE SUCH COUNTRIES THAT THE SECURITY OF ACCESS NOW BE...G

NEGOTIATED WOULD BE PRESERVED EVEN IF THE COMMUNITY OR INDIVIDUAL

MEMBER STATES NEEDED TO TAKE AUTONOMOUS ACTION AT A LATER STAGE.

IF THE COMMUNITY INSISTED ON KEEPING ALL ITS OPTIONS OPEN UNTIL ALL

AGREEMENTS WERE TIED UP, IT WOULD BE UNREASONABLE TO EXPECT OUR

NEGOTIATING PARTNERS, PARTICULARLY THOSE WHO CAME FIRST TO THE NECOTIATING TABLE, TO ACCEPT THE SACRIFICES WE WERE DEMANDING OF THEM, TRAN ADDED THAT IF THE BILATERAL AGREEMENTS WERE, AT THE END OF THE DAY, DEEMED TO FALL SHORT OF WHAT WAS NECESSARY TO PERMIT US TO RENEW THE MFA, AUTONOMOUS MEASURES WOULD BE SET IN HAND PENDING ATTEMPTS TO AMEND THE ARRANGEMENT. BUT SUCH COMMUNITY MEASURES

SHOULD LOGICALLY PRESERVE THE RESULTS OF THOSE BILATERAL NEGOTIATIONS

THAT HAD CONCLUDED SATISFACTORILY.

3. THE GERMAN, BELGIAN AND ITALIAN DELEGATIONS AGREED THAT THE COMMISSION COULD PROPERLY GIVE THE NECESSARY ASSURANCES, WE SAID THAT THE COMMISSION QUESTION RAISED THE PROBLEM OF ARTICLE 3 OF THE DRAFT AGREEMENT: AND FARRY DEPLOYED THE ARGUMENTS IN YOUR

TELEGRAM UNDER REFERENCE.

4. DISCUSSION OF THIS PROBLEM WAS ADJOURNED TO A MEETING OF HEADS

OF DELEGATIONS HELD THIS MORNING. AT THIS MEETING THE COMMISSION STATED THAT IN THEIR VIEW THEY COULD, REPEAT COULD, DEFEND THE APPLICATION OF SELECTIVE MEASURES UNDER GATT ARTICLE XIX. ONE

ARGUMENT AVAILABLE WAS THAT TO APPLY RESTRAINTS INDISCRIMINATELY

WOULD IN FACT AMOUNT TO DISCRIMINATION AGAINST THE LESS DEVELOPED

COUNTRIES AND IN FAVOUR OF THE SUPER-COMPETITIVES, WHO WOULD

ALWAYS BE BETTER PLACED TO TAKE ADVANTAGE OF SUCH RESTRICTED

OPPORTUNITIES AS REMAINED. THE COMMISSION SUPPORTED THIS

INTERPRETATION WITH REFERENCES TO ARTICLE XVI11 AND ARTICLE XXXVI,

PARAGRAPH 4, OF THE GATT.

5. THE COMMISSION ADDED, WITH REFERENCE TO ARTICLE 29 OF THE DRAFT AGREEMENT WHICH PROVIDES FOR MODIFICATION OR DENUNCIATION AFTER 90 DAYS NOTICE, THAT THE THREAT OF DENUNCIATION AND OF SUBSEQUENT ARTICLE XIX ACTION, SHOULD IN NORMAL CIRCUMSTANCES BE SUFFICIENT TO RAILROAD THROUGH ANY AMENDMENTS REQUIRED BY THE COMMUNITY TO

TIGHTEN UP ANY LOOP-HOLES THAT CAME TO LIGHT. BUT IF IT WERE NECESSARY TO DENOUNCE THE AGREEMENT, THE THREAT OF DISRUPTIVE FORESTALLING DURING THE THREE MONTHS' NOTICE PERIOD WOULD BE GREATLY DIMINISHED BY APPLICATION OF ARTICLE 11 OF THE DRAFT

AGREEMENT.

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/6. WE AND